BTIG analyst David Larsen has maintained their neutral stance on SLP stock, giving a Hold rating today.
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David Larsen has given his Hold rating due to a combination of factors reflecting both progress and lingering concerns. Simulations Plus slightly exceeded revenue expectations and reaffirmed full-year guidance, and its services segment showed solid growth with improved margins and a stronger backlog, signaling healthier demand trends. However, the company missed EBITDA expectations, and software revenue, particularly in clinical operations, declined sharply year over year, raising doubts about the pace and consistency of the recovery. Management’s commentary suggests that macro conditions and funding dynamics are improving, but Larsen believes it will still take time before this translates into sustained, broad-based revenue acceleration.
At the same time, valuation does not offer a clear bargain relative to peers, with SLP trading broadly in line with the sector on an enterprise value to forward EBITDA basis. The combination of pressured profitability, uneven segment performance, and only gradual improvement in demand leads Larsen to view the risk/reward as balanced rather than compelling. He notes that software renewal rates have slipped and that competitive and consolidation pressures in the space may be affecting growth, even as average revenue per customer edges higher. Altogether, these mixed signals support maintaining a neutral stance instead of recommending investors actively buy or sell the stock at this stage.
In another report released today, TipRanks – OpenAI also reiterated a Hold rating on the stock with a $20.00 price target.
SLP’s price has also changed slightly for the past six months – from $17.510 to $18.050, which is a 3.08% increase.